Event

On the evening of March 31, Jianxin shares released its 2013 annual report, with an annual operating income of 411 million yuan, an increase of 16.95% over the same period last year. The net profit belonging to shareholders of listed companies was 36.1333 million yuan, an increase of 204.14% over the same period last year, and earnings per share was 0.27 yuan.

The dividend plan is to distribute a cash dividend of 0.8 yuan (including tax) for every 10 shares, and to increase 10 shares for every 10 shares to all shareholders with the capital accumulation fund.

Brief comment

The rise in product prices and the improvement of gross profit are the main factors contributing to the sharp rise in the company's performance.

Most of the products in the m-amino industry chain are seriously polluted, the treatment of the three wastes is difficult, and the investment in environmental protection is high, while several domestic production enterprises in this industry chain are small and medium-sized enterprises with poor technical and financial strength. the result of the treatment of the three wastes is difficult to meet the national standards. In 2013, the domestic environmental protection requirements for the chemical industry gradually became stricter, and the enterprises in the m-amino industry chain were the first to bear the brunt. Many domestic amino-based small and medium-sized enterprises were forcibly shut down because of substandard environmental protection, resulting in a shortage of products in the m-amino industry chain and a sharp rise in product prices; while the company has been paying attention to enterprise environmental protection, making use of its technical advantages in the treatment of three wastes to eliminate environmental bottlenecks and reduce production costs. The rise in product prices and the decline in company costs have led to a substantial increase in the gross profit margin of the company's products. In 2013, the gross profit margin of intercompany hydroxyl, 2,5 acid and other major products increased by more than 10 percentage points compared with last year. The increase in gross profit has become a major factor in the substantial increase in the company's net profit in 2013.

The company's product prices are expected to rise sharply in 2014.

We believe that the domestic environmental protection requirements will be further strengthened in 2014, and it is impossible for the enterprises in the closed m-amino industry chain to resume production, while some of the remaining enterprises' environmental protection treatment is also in jeopardy. The production load of these enterprises will remain at a low level all the year round, and the supply of products in the domestic amino industry chain will be more tight. The lower reaches of the m-amino industry chain are mainly dyes, rose essence, brighteners and other products. These products have a good industry structure and strong bargaining power downstream, and can effectively transfer the rising costs caused by the rising prices of products in the m-amino industry chain. Higher acceptance of the price rise of m-amino and other products In addition, the company is the leader of the inter-amino industry chain, the market share of many products is the first in the world, and the production capacity of the company is flexible. Under the circumstances of tight supply and demand of products and good acceptance downstream, we think that there is still a large upward space for products.

Fund-raising projects and over-raising projects have entered the volume period.

In 2013, the company's fund-raising and super-fund-raising projects have basically been completed and put into production, and the production capacity of most of the company's products has doubled, but in 2013, except for a few small varieties of products, such as nitrosulfone, OBD2 and other products, the production and sales of other products basically did not increase significantly. We believe that in 2014, there will be an imbalance between supply and demand of most products in the domestic amino industry chain, and when the company's project is put into production, the company will take advantage of the opportunity to increase production and sales, further seize the market, increase the market share of products, and consolidate the company's leading position in the industry.

It is expected to increase the rating of EPS0.81 yuan in 2014.

The supply and demand of the company's products will continue to be tight in 2014, and prices still have room to rise. We expect EPS0.81, 1.06,1.29 yuan from 2014 to 2016 to increase the rating.